Sprunk v. Prisma LLC, 14 Cal. App. 5th 785

Background

Plaintiff Maria Elena Sprunk sued Plan B Club (Prisma LLC) in a wage-and-hour putative class action alleging misclassification of exotic dancers and related wage violations; she and other class members signed entertainer contracts containing arbitration clauses (two versions existed; Sprunk signed the pre-July 2011 version).
Plan B filed a petition to compel individual arbitration against Sprunk in January 2012, then withdrew that petition in September 2012 and answered the complaint; discovery and class-certification proceedings continued.
Plan B later defended against class certification in part by arguing class members had arbitration agreements; the trial court certified the class on April 24, 2015.
After certification, Plan B moved (Aug 12, 2015) to compel individual arbitration as to class members; the trial court denied the motions, concluding Plan B waived the right to arbitrate by delaying and litigating in court instead of pursuing arbitration earlier.
The court found Plan B’s stated justification — uncertainty in the law on class arbitration waivers and futility of prior motions — insufficient, and that the St. Agnes waiver factors (including prejudice from delay and invocation of litigation machinery) supported denial.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether a defendant can waive the right to compel arbitration against absent class members by withdrawing a motion to arbitrate the named plaintiff and litigating to class certification	Sprunk: Plan B waived arbitration by filing then withdrawing its motion to compel against Sprunk and litigating for years before seeking arbitration of the class	Plan B: Absent class members were not parties pre-certification; it could not compel them earlier and withdrawal was reasonable given uncertainty in the law	Held: Court affirmed waiver — Plan B’s withdrawal and prolonged litigation were inconsistent with intent to arbitrate and supported waiver as to class members
Whether the "futility" rule excuses delay in seeking arbitration when the law made earlier motions unlikely to succeed	Sprunk: Futility did not excuse Plan B’s decision; ample authority existed to move earlier	Plan B: Withdrew motion because prevailing law then made individual arbitration unlikely (Gentry/Horton uncertainty) and thus initial efforts would have been futile	Held: Futility did not excuse Plan B’s multi-year delay; pre-Iskanian case law and post-Concepcion developments made a timely motion reasonable, so delay supported waiver
Whether the trial court properly considered delay before class certification when analyzing waiver as to absent class members	Sprunk: Court may consider delay against named plaintiff because a ruling compelling Sprunk to arbitrate would likely have moot ed or resolved the litigation for the class	Plan B: Delay against absent members is irrelevant because they were not parties pre-certification	Held: Court may consider Plan B’s decision not to pursue arbitration with the named plaintiff when assessing waiver as to later-class members given practical effect of compelling the named plaintiff
Whether Plan B produced sufficient evidence that class members signed arbitration agreements	Sprunk: Plan B failed to authenticate signed agreements for unnamed class members	Plan B: Produced contract forms and GM declaration stating each class member signed one of the forms	Held: Evidence was sufficient under Cal. R. Ct. 3.1330; authenticity was not meaningfully disputed and trial court properly considered the declarations

Key Cases Cited

AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (preemption of state rules that effectively prohibit class-action waivers in arbitration)
Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., 559 U.S. 662 (parties are not compelled to class arbitration absent contractual basis)
Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal.4th 348 (Concepcion abrogated Gentry; futility can excuse initial delay to compel arbitration)
St. Agnes Medical Center v. PacifiCare of California, 31 Cal.4th 1187 (factors relevant to waiver of arbitration)
Gentry v. Superior Court, 42 Cal.4th 443 (pre-Concepcion rule assessing when class arbitration waiver may be unenforceable)
D.R. Horton, Inc. v. N.L.R.B., 737 F.3d 344 (Fifth Circuit reversal of NLRB ruling that class/collective waivers violate NLRA)